Underrated cards: Canadian Tire Cash Advantage

This card is one of the permanent additions to my portfolio. I think it’s one of the most underrated cards on the market, if not the most. The card has no annual fee and offers a tiered cash back system:

0.25% on your first $1,500 in purchases

0.50% on the next $1,500 up to $3,000

1.00% up to and including $24,000

And finally 1.50% on anything above $24,000

At first glance, this appears to be a pretty ho-hum card. Lower earnings than other cash back sites on the market. It’s got a killer-feature that almost no-one knows about.

Canadian Tire Mastercard’s Killer Feature

The Canadian Tire Mastercard allows you to pay most of your bills using an interface similar to your online banking. This means that you can pay vendors that normally don’t accept credit card.

Examples of vendors that you can pay with this system include:

Universities

Utilities

Insurance companies

Student loans

You can see the full list of vendors on this spreadsheet maintained at Redflagdeals.

Here’s the best part. Every payment you pay using Canadian Tire’s billpay system is treated like a purchase. That means cash back on tons of different purchases that you would otherwise need to pay a fee on (e.g. PayTM or Plastiq).

Getting approved and credit limits

Canadian Tire is notoriously stingy with their credit limits to begin with. I started with a $500 limit and it took months to increase that limit to $7,500. In contrast, CIBC in that same week granted me a $30,000 limit on a new card.

Manufactured spending with this card

When this card first launched, a number of brokerage accounts and credit cards were listed. You could cycle money through the card as quickly as the card would recognize payments.

Unfortunately, those easy days are over. There are two brokerage accounts in the list that I think might still work for this trick. If you’re willing to be more ethically challenged, there are several vendors that you could make payments to that will cut you a refund in the form of a cheque.

Sorry no hints from me on this one. You’ll have to do the legwork to find these opportunities yourself!

Save costs as a business owner

I’m often asked by business owners what the best way to earn points through payroll is. The short answer is that it’s almost never worth it to pay a third party processor like Telpay or Payrollrewards because the fees they charge far outweigh the value of the points you earn.

If you’re a small business owner, I have a solution for you. This card lists Ceridian and a handful of smaller payroll companies as bill payers. You could be saving 1.5% on your payroll costs. Chances are high that other vendors you use will be on this list too.

Conclusion

The Canadian Tire Cash Advantage card never makes its way into my wallet, but it has some excellent use cases if they fit your needs. Thanks to its no annual fee, it’s also an excellent anchor card to keep forever to increase your average age of accounts.